Brent crude already risen 3.1 per cent to $77.20
Just hours after Donald Trump pulled the US out of Iran nuclear deal and said he would reimpose economic sanctions to undermine the “horrible one-sided deal that should never, ever have been made”, the oil price has hit its highest level in three and a half years.
The Iran Deal is defective at its core. If we do nothing, we know what will happen. In just a short time, the world’s leading state sponsor of terror will be on the cusp of acquiring the world’s most dangerous weapons…. pic.twitter.com/58qwBLzxIH
— Donald J. Trump (@realDonaldTrump) May 8, 2018
In a roller-coaster day of trading, brent crude is continuing to rise and just hit $77.20 per barrel for the first time since November 2014.
According to media reports, the new crippling sanctions will target the Iranian oil sector, reducing energy companies’ business with Iran and increasing the price of oil. But the reduced Iranian supply could lead to sustained high oil prices and further geopolitical instability, in turn contributing to inflation and slowing economic growth at home.
Iran, the third-biggest producer among the Organization of the Petroleum Exporting Countries, produces about 3.8m barrels per day (bpd), or about 4 per cent of the world’s oil supplies.
Meanwhile, Theresa May has stated she regretted Donald Trump’s decision to exit the 2015 agreement. “We urge all sides to remain committed to its implementation and to act in a spirit of responsibility”, the group, which includes France and Germany, wrote.